10 Golden Rules On Doing Your Accounts
Pianists and keyboard players don’t tend to be too keen on doing their tax returns, so here is some basic advise for dealing with the HMRC when planning and doing your self assessment. Most self employed piano teachers start their tax Year from 5th April so now is a good time to start planning how you are going to log your finances and earnings from teaching. These tips come from our tax guide we provide to our tutors who have applied for the ‘Tax Spreadsheet‘ option.
The Tax Office Golden Rules
1. If you are just starting to become a piano tutor, you must register with the HM Revenue and Customs as self-employed within the first 3 Months of business. Failure to do so can incur an automatic £100 penalty.
2. Be honest with the taxman. It pays in the long run. Don’t think that you can fool them, either, as a high percentage of tax inspectors are top class university graduates.
3. When you write a letter or email to the taxman, keep a copy for future reference.
4. Get receipts for everything that you pay out. The taxman is entitled to see a receipt for everything you claim for.
5. If in doubt about any expenses or allowances – CLAIM THEM! Give full details to the taxman and let him decide – that’s his job!
6. Don’t ignore communications from the taxman. He won’t go away and can get quite nastily persistent. It will only lead to estimates of your income being made, which always ends up with you paying excessive tax.
7. Don’t write nasty letters to the taxman, even if he’s made a mistake. It won’t get you anywhere. A polite letter receives far more sympathetic consideration from anyone.
8. In spite of all you’ve heard about tax inspectors, most of them are very fair people. They are there to ensure that you pay the correct amount of tax – no more and no less. They don’t get paid on a commission basis either!
9. It is well worth putting some money aside as you go along to cover your tax bills when they arrive.
10. We recommend that you make an appointment to call the tax office at the start of January each Year so they can assist in uploading your tax records into their system.